Pay Cut or Be Cut: The Reality of August Football

August can be a very trying month for many mid-tier veteran football players. While many people assume that making it past March is a sign that a player is likely to make a team all it means is that the player makes it through round 1 of the process. If you are lucky enough to have offseason bonus money in your contract at least you earned something for the year. If you don’t have bonus money in your contract you may be worse off than you would be by being released in March.

The middle rung of the NFL roster is unfortunately the group that constantly gets the short end of the stick when it comes to financials. Teams scramble for any opportunity to create salary cap space and save a few dollars here and there. Rarely is the high priced player approached to sacrifice some money for the team. In most cases they are far too protected with base salary guarantees and dead money to even approach. So the attention turns to those mid tier players who will never be stars but are capable football players.

In the summertime teams get incredible leverage over the veteran players. It is one thing for a team to discuss the potential of their rookies or young signings and another to actually see them begin to practice. The NFL is a young man’s game and if the option is a low cost player with upside versus a moderate cost veteran with none, in many cases the low cost player is going to win out. Teams use that to their advantage.

Because the calendar has moved beyond June 1st the rules of contract acceleration change. A player who is released during training camp will only have their signing bonus proration for the current league year count towards the salary cap. The remainder of the bonus accelerates into the following season. This is different than a cut prior to June 1 in which all the money accelerates into the current league year.

This is an important valuation difference even though the total acceleration charge is the same. You have to realize that at this point in time cutting a player in August operates the same from a cap perspective as keeping a player all season and then cutting him in 2014. By cutting him today you save yourself the non-guaranteed portion of his base salary, thus increasing your current year’s salary cap space. Sure you have the dead money in 2014, but you were going to have that anyway. You may as well save some extra money now that you have some replacement parts in place.

Back in March maybe the cost under normal valuations is too high to cut a player who may contribute to the team. You don’t know who you will draft nor do you know how the draft pick will work out. Now you see how a 3rd or 4th rounder has progressed and the mid tier player begins to become more vulnerable than ever. Teams still don’t really know in August but with more information they can be more confident in their approach.

What happens next is that players are asked to take paycuts. We saw that in Buffalo with Brad Smith who likely had no chance to make the team(had the Bills switched GM’s earlier he probably would have been cut in March) without taking a paycut. Smith could say no but consider his options at this point.

Smith now makes his in-season residence in Buffalo and you are asking him to pick up and go. Secondly, and perhaps more importantly, training camp has begun. Teams are pretty focused on their rosters and while they will always look for upgrades you have to be realistic. Smith is two years removed from being a relevant player to a team. He is being cut by one of the worst teams in the NFL. Are teams going to be knocking at his door with a great paying gig? No chance. At best he’ll get a minimum salary deal with some team and that is if he is lucky.

His best chance is to take whatever paycut the Bills offer and hope he can stand out in camp. After all, the Bills did think enough of him to at least give him the camp opportunity. They didn’t grab anyone in a major position to uproot his spot on the team. Someone may take it but if not Buffalo has shown an inclination to keep him.

This extends all the way down to players at the tail end of their rookie contracts. Most first contract players earn escalators in the 4th season that is the equivalent of the lowest cost RFA tender, which for this season is $1.323 million. Unfortunately the salary isn’t guaranteed so teams make the decision that the player either needs to give up his escalated salary and return it to the minimum or be cut. In some cases a player is lucky and if he has any leverage can grab some guarantees and maybe meet halfway in between.

Last season Jets starting LG Matt Slauson fell into this category. This was really the dark side of the NFL and the salary cap. Slauson’s salary jumped to just over $1.3 million due to playing time and workout participation. Rather than paying him this amount the Jets created a fictional competition in training camp between he and G Vlad Ducasse, with Rex Ryan praising the younger Ducasse and talking about how the job was wide open. The Jets knew Ducasse was not good so Slauson had some leverage, but still he had to take a $258,000 paycut to ensure he stayed a Jet. The day he signed his new contract Slauson was named starter.

While the numbers don’t seem like much this pay cut represented close to a 20% decrease in salary for Slauson. O’Brien Schofield, claimed this week by the Seahawks, took a 47% pay cut to get a chance to make Seattle’s roster. These are significant numbers. This would be the equivalent of Sidney Rice taking a $3.995 million dollar pay cut. Asking Rice to take the same number pay cut is only 8% of his salary for the year, but the name player is rarely asked and this low tier guys get the short end of the stick. It makes you wonder what point there even is to earning the escalator.

Unfortunately for the players they have almost no options. September is just around the corner. There is no time to sell your services to multiple teams and pick and choose what looks like a good spot. Those jobs are already filled. There is only one answer most players can give to the question “Either you will take this pay cut or you will be cut”. It’s not fair, but expect to see more of this in the coming weeks.

Featured Contract

Russell Wilson signed a four year contract extension with the Seahawks worth $87.6 million on July 31, 2015. According to SI's Peter King, Wilson received a $31 million signing bonus. Per Ian Rapoport of NFL.com the following tweet has the breakdown of the Wilson extension which we are using to estimate the cap charges at the moment. Wilson received $31.7 million fully guaranteed upon signing. His 2016, 2017, and $4.9 million of his 2018 salary are guaranteed for injury and will become fully guaranteed on the 5th day of the waiver period in 2016 and 2017. The total guarantee is $61.542 million.